3 NOVEMBER 2023 ASIAN TRADER 5
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Newly published retail sales
data has added to economic
gloom and offered no respite
for the government, which has
suffered fresh vote setbacks.
Retail sales slid 0.9% in
September, the Office for
National Statistics said in a
statement.
“Retail sales fell notably in
September, with retailers
telling us that cost-of-living
pressures are influencing
consumers, particularly for
non-essential goods,” added
ONS chief economist Grant
Fitzner.
“It was a poor month for
clothing stores as the warm
autumnal conditions reduced
sales of colder weather gear,”
he added.
The often-volatile retail
sales had grown 0.4% in August.
Looking at the quarterly
picture, sales volumes fell by
0.8% in the three months to
September 2023 when
compared with the previous
three months.
Foodstore sales volumes
rose 0.2% in September,
following a rise of 1.4% in
August. However, volumes fell
by 1.3% in the three months to
September from the previous
three, and, when compared
with their pre-pandemic
February 2020 levels, they
were down 3.7%.
Retail sales slide as
cost-of-living bites – ONS
Lighting up the darkness
iwali is here again, that most important
Indian holiday, which increasingly feels so
natural and welcome a part of the UK’s festive
calendar. Like Bonfire Night, it arrives at exactly the
right time to spread light and comfort – not in the
depths of winter, when we have adjusted to cold and
darkness, but rather at its onset, when we are still
apprehensive and need reassurance that the light and
warmth of a new spring and summer will return.
It’s redolent of what the economic outlook appears
to be at the moment: an oncoming darkness, but with
a flame of hope flickering in it and guiding us through
the gloomy times and hopefully out the other side.
First, the darkness. Although recent economic data
has inflation slowing (but persisting) and some
grocery prices easing an even in certain cases falling,
at the same time we are informed that consumer
confidence is waning, and that the population is
planning to spend much less on Christmas this year,
for example.
There is no contradiction here, because budgets are
squeezed, and despite good news on prices, the pound
has fallen 8% against the dollar in just over a month
– a dramatic move suggesting a lack of confidence in
UK fundamentals and higher prices again on the way.
Add to that the fact that very many fixed-term mort-
gages – hurriedly contracted a few years ago out when
interest rates were still low – are now coming to an
end and need to be refinanced at twice or three times
the earlier rate at least. This will push up repayments
for many thousands of families by anything from 40%
to 100%. Many people might not then be able to afford
to buy anything else except essentials for a long time.
Forget Christmas, forget eating out, forget a new
car – the economy will reflect the increased budget-
ary tightness experienced by households as their
funds are diverted into keeping a roof over their heads
– and housing, currently accounting for more than
20% of inflationary pressure in the UK, will soon be
accounting for much more.
On the other hand, while the times of low interest
rates and easy credit have probably gone for many
years, it is easy to forget that unemployment remains
at historic lows and that standards of living remain
the highest in history for the masses. UK economic
performance has recently been shown to be among
the best in Europe and nowhere near the basket-case
level that many reports would have us believe. There
is much debt, but Britain is increasingly a safe haven
for global monetary flows and national borrowing at
decent rates is easier here than almost anywhere else.
For the convenience channel, the combination of
being at the centre of hard-pressed communities and
seen as a support by local people, together with the
fact that food and drink are the essentials that people
will continue to buy, makes the sector a real flame of
comfort and light in the surrounding gloom, for both
shoppers and indie retailers thinking about the
future.
NEWS/COMMENT
High street shops in England
could see their business rates
bill quadrupling, collective-
ly increasing by up to £1.95
billion next year, following
new inflation data, claim mul-
tiple reports, with industry
chiefs warning it will “un-
doubtedly be the final nail in
the coffin for many” firms.
The ONS revealed
inflation in September was 6.7%.
The multiplier, which is applied
to the rateable value of proper-
ties, typically rises each April in
line with the previous Septem-
ber’s inflation rate.
Estimates compiled by
advisory group Altus showed that
retail stores will be struck by a
£15,300 business rates bill for an
average site from next April. This
is compared to £3,600 for the
current year, subject to caps on
tax reliefs.
“The current business rates re-
gime is already crippling retailers,
so the prospect of a £1.95bn jump
in rates next April will be
impossible for some retailers to
find,” said Jacqui Baker, head of re-
tail at RSM consultants. “The
Chancellor needs to extend the
current relief measures for
another year whilst delivering
real reform that is fit for purpose
to allow the high street to not
only survive, but to thrive.”
Helen Dickinson, head of the
British Retail Consortium, said
the rise would “inevitably put
renewed pressure on consumer
prices” and called on the govern-
ment to take steps to ease the
expected increase.
“As a result, retailers are
publicly calling on the Chancellor
to freeze the business rates
multiplier, allowing them to keep
driving down prices, and invest in
new shops and jobs.”
New calls from retailers to end multiplier madness
Business rate in
Business rate in
England to ‘quadruple’
England to ‘quadruple’